Jeff Bezos’ Arcane Thinking

Amazon.com CEO Jeff Bezos bought the Washington Post out of pocket a month ago. Since then, analysts have been wondering how Bezos, who made his fortune through web innovation, would address the declining fortunes of U.S. print media.

Writing for the Washington Post‘s techno-policy blog The Switch, staffer Timothy B. Lee says the mogul’s answer is unfortunately passe. It doesn’t bear in mind how the industry has changed.

Particularly confusing is Bezos’ insistence that the idea of the “bundle” can still work:

“The problem is how do we get back to that glorious bundle that the paper did so well?” Bezos asked at a question-and-answer session with Post journalists.

Bezos lauded the “daily ritual” of reading the morning newspaper over coffee. “That daily ritual is incredibly valuable, and I think on the Web so far, it’s gotten blown up.”

But that daily ritual got blown up for good reason. Trying to recreate the “bundle” experience in Web or tablet form means working against the grain of how readers, especially younger readers, consume the news today. In the long run, it’s a recipe for an aging readership and slow growth.

Lee goes on to argue that the market has moved towards news aggregate services such as Reddit that are read throughout the day, rather than newspaper bundles that are read as a morning ritual. While aging readers may still consume their news that way, younger audiences who grew up with the Internet do not. News media is different now.

As the author points out, the way to make money in today’s news media is to treat each individual piece as a commodity that needs to be promoted and sold. The idea of the “bundle” is dead because people do not consult a single news source anymore. A more pinpoint approach is needed. This is in addition to “growing the brand” of a larger website, which Bezos inflates in importance.

And advertisers have already noticed. Bezos forgets that the “bundle” experience required pages of advertisements to be profitable in the first place. Unless they are convinced otherwise, and there is no guarantee that will happen, Bezos’ strategy is simply anachronistic.